Use of palm oil in KIT KAT

Nestl is the largest food and nutrition company in the world, founded and headquartered in Vevey, Switzerland. Nestl originated in a 1905 merger of Anglo-Swiss Milk Company, established in 1867 by brothers George Page and Charles Page, and Farine Lacte Henri Nestl, founded in 1866 by Henri Nestl. The company grew significantly during the First World War and following the Second World War, eventually expanding its offerings beyond its early condensed milk and infant formula products. Today, the company operates in 86 countries around the world and employs nearly 283,000 people. Nestl has 6,000 brands with a wide range of products across a number of markets including coffee (Nescaf), bottled water, other beverages (including Aero (chocolate) & Skinny Cow), chocolate, ice cream, infant foods, performance and healthcare nutrition, seasonings, frozen and refrigerated foods, confectionery and pet food In 2009, consolidated sales were CHF 107.6 billion and net profit was CHF 10.43 billion. Research and development investment was CHF 2.02 billion. Sales by activity breakdowns are, 27% from drinks, 26% from dairy and food products, 18% from ready-prepared dishes and ready-cooked dishes, 12% from chocolate, 11% from pet products, 6% from pharmaceutical products and 2% from baby milks. Sales by geographic area breakdown: 32% from Europe, 31% from Americas (26% from US), 16% from Asia, 21% from rest of the world. In 2010 nestle faced a severe criticism on Nestls kit Kat as the company purchases the palm oil (used in kit Kat) from those producers which are involved in deforestation. Rapid deforestation in Borneo and other regions to harvest hardwood and make way for palm oil plantations sends massive amounts of carbon dioxide into the atmosphere. In particular, where peat swamp forests are cleared, destroying the habitat for many threatened species of animals such as the orangutan, much public attention has been given to the environmental impact of palm oil and the role of multi-nationals such as Nestl in this. There is ongoing concern by various NGOs including Greenpeace.

The issue was spreading through public-relations is bomb for Nestle, as people were commenting on its Facebook page after Greenpeace posted a mock-up of the company's Kit Kat candy bar logo on its own Web site and Facebook members adopted the graphic as their profile picture. Nestls moderator wrote: "We welcome your comments, but please don't post using an altered version of any of our logos as your profile pic - they will be deleted." Nestl were met with "a deluge of criticism from consumers, after a large number of Facebook users posted negative comments about the company's business practises." Nestl's attempt to engage with the issue were met with criticism, including headlines stating: "Nestl fails at social media", and "Nestl Loses Face On Facebook" A Greenpeace report accusing Indonesian palm oil producer Sinar Mas of responsibility for widespread destruction of endangered rainforests and peatlands for palm oil plantations, Nestle announced in March that it would cease doing business with the company Nestl Chairman, Peter Brabeck-Letmathe, in answer to a question from Greenpeace, told the Companys Annual General Meeting in Lausanne on April 15, 2010 that in 2009 Nestl used 320,000 tonnes of palm oil worldwide, comparing this with the 500,000 tonnes of palm oil used for biodiesel in Germany and Italy alone. After it Nestle announced that it would stop purchasing palm oil from the world's second largest producer out of concern over rainforest destruction, but Greenpeace that the company has failed to keep this promise. In May 2010 Nestl said it was inviting The Forest Trust, a not-for-profit group, to audit its supply chain and promised to cancel contracts with any firm found to be chopping down rainforests to produce the palm oil which it uses in KitKat, Aero and Quality Street. Greenpeace welcomed the agreement promising to monitor it closely. "We will continue to pressure our suppliers to eliminate any sources of palm oil which are related to rainforest destruction and to provide valid guarantees of traceability as quickly as possible," Nestle said. Nestl views the destruction of tropical rainforests and peatlands as one of the most serious environmental issues facing mankind. It is estimated that rainforest destruction contributes to

around 20% of carbon dioxide emissions more than the entire transport sector.

Due to increasings concerns pertaining to the issue of Palm Oil and sustainability, Nestl organised a special forum entitled Committed towards Sustainable Palm Oil and Diversity with key stakeholders and the media to create better awareness on the issues plaguing the industry and understand the action taken by the key protagonists involved. Participants included the Roundtable for Sustainable Palm Oil (RSPO), Malaysian Palm Oil Council (MPOPC), WWF-Malaysia and United Plantations Berhad. Nestl S.A. was represented by Mr. Jos Lopez, Executive Vice President for Operations. The company also pledged that by 2015, all the palmoil it uses will be certified sustainable. Nestl has made a statement on its own Web site in response. It says, among other things, that: "The company recently announced its commitment to using only 'Certified Sustainable Palm Oil' by 2015, when sufficient quantities should be available." Adding that, "As a part of this commitment, we have accelerated the investigation of our palm oil supply chain to identify any palm oil source which does not meet our high standards for sustainability. Specifically, Nestl has replaced the Indonesian company Sinar Mas as a supplier of palm oil with another supplier for further shipments. We confirm that Nestl has only bought from Sinar Mas for manufacturing in Indonesia, and no palm oil bought from Sinar Mas has been used by Nestl for manufacturing in any other country." It appears as if right now Nestl has high standards for the palm oil it uses, but the company can't promise that those standards are actually met. Nestl has committed to make sure the standards are met by 2015. A large business like Nestl can't shift gears overnight, but surely it can take less than five years.